Docstoc

Contractual Terms

Document Sample
Contractual Terms Powered By Docstoc
					                                                                    Contractual Terms




Contractual Terms
By Igor Sterzhantov©2011
www.lawandsea.net

Introduction................................................................................................................................................... 1

Condition and warranty................................................................................................................................. 1

Innominate term ............................................................................................ Error! Bookmark not defined.




Introduction
Considering the contract as an exchange of binding promises it can be said that any breach of such
promise by the party in fault gives to the innocent party a right to seek for appropriate remedies, unless
liability for breach in question expressly excluded1. In many cases contract specifically provides for
remedies available to the aggrieved party, in all other instances this question to be decided by the court2.
Extent of available remedial actions depends on the nature of the terms has been breached, on
consequences, and effect of it, subject to limiting or excluding provisions, if any.

Contractual terms are distinguished from mere representations3, not intended to be promises4. In other
words, no liability can arise if statement was made without any intention to form any kind of contractual
relationship. As Lord Moulton said in Heilbut, Symons & Co v Buckleton [1913] AC 30 at p.51

            … a person is not liable in damages for an innocent misrepresentation, no matter in what way or
            under what form the attack is made. In the present case the statement was made in answer to
            an inquiry for information. There is nothing which can by any possibility be taken as evidence of
            an intention on the part of either or both of the parties that there should be a contractual
            liability in respect of the accuracy of the statement. It is a representation as to specific thing and
            nothing more.


Condition and warranty
Historically English law recognised a distinction between two classes of contractual terms: conditions
and warranties5. In his famous expression about peas versus beans in Chanter v Hopkins (1838) 4 M & W
399, Lord Abinger CB considered "unfortunate use made of the word warranty" at 404:



1   See exclusion clauses

2   See more on Breach page.

3   A "representation" is a statement, or assertion, made by one party to the other, before or at the time of a contract, of some
    matter or circumstance relating to it, by Williams Jin Behn v Burness (1863) 3 B & S 751 at p.753.

4   Pasley v Freeman (1789) 3 Term Rep 51, Heilbut, Symons & Co v Buckleton [1913] AC 30

Igor Sterzhantov©2011                                                                                                                                 page 1
                                                      Contractual Terms

         A good deal of confusion has arisen in many of the cases on this subject, from the unfortunate
         use made of the word "warranty." A warranty is an express or implied statement of something
         which the party undertakes shall be part of a contract; and though part of the contract, yet
         collateral to the express object of it. But in many of the cases, some of which have been referred
         to, the circumstance of a party selling a particular thing by its proper description, has been called
         a warranty; and the breach of such contract, a breach of warranty; but it would be better to
         distinguish such cases as a non-compliance with a contract which a party has engaged to fulfil;
         as, if a man offers to buy peas of another, and he sends him beans, he does not perform his
         contract; but that is not a warranty; there is no warranty that he should sell him peas; the
         contract is to sell peas, and if he sends him any thing else in their stead, it is a non-performance
         of it.

At the end of the nineteenth century, statutory intervention eventually gave the term 'warranty' settled…

Read the rest of this article on: http://www.lawandsea.net/Contract/Contract_Contractual_Terms.html




5   As Lord Denning, M.R. said in Attica Sea Carriers Corpn v Ferrostaal Poseidon Bulk Reederei GmbH (The Puerto Buitrago)
    [1976] 1 Lloyd’s Rep 250 at p.253 the question whether a stipulation is a warranty or a condition has come before the Courts
    for the last 200 or 300 years.

Igor Sterzhantov©2011                                                                                                   page 2

				
DOCUMENT INFO
Shared By:
Stats:
views:112
posted:12/21/2011
language:English
pages:2
Description: Considering the contract as an exchange of binding promises it can be said that any breach of such promise by the party in fault gives to the innocent party a right to seek for appropriate remedies, unless liability for breach in question expressly excluded . In many cases contract specifically provides for remedies available to the aggrieved party, in all other instances this question to be decided by the court . Extent of available remedial actions depends on the nature of the terms has been breached, on consequences, and effect of it, subject to limiting or excluding provisions, if any.